Rich Dad Poor Dad Review
This book, shockingly ranked #1 on Amazon for Personal Finance, might as well have been called Rich Dad Poor Dad Hopelessly Deluded Author. It’s so far detached from real-life wealth generation, that you should probably confine all future Robert Kiyosaki works to the Fiction section. He clearly specialises in talking out of his arse.
It’s five years since I was first recommended Rich Dad Poor Dad, a bestseller that I have always treated with skepticism given the murky nature of Kiyosaki’s upselling regime that sits behind the brand.
After reading the book in two pained sittings, I can safely say that anybody who recommends this slice of warble as valuable literature in the field of personal finance, is out of his damn mind, and knows jack diddly squat about personal finance.
Before we even get to the plot, it has to be said that Kiyosaki is a terrible writer. His storytelling unravels in scenes that would not look out of place in a poorly scripted infomercial. This, of course, is no coincidence. The infomercial is a perfect match for Kiyosaki’s primitive take on wealth generation. The rich are a collective, and the poor are a suffering crowd. It’s in such simple terms that Rich Dad Poor Dad thrives.
It’s difficult to decipher the author’s exact message at times. But I think I’ve nailed it down to 3 key points:
1. Education is important, but always second to financial literacy. People turn out poor because they’re not taught financial literacy.
2. Real estate is a fastlane to wealth. Buy properties at discounted prices, flip them and bank the just rewards. He doesn’t give details on how to implement this ninja wisdom, or how to beat the market. He places the burden on ‘insider tips‘. Mmm, fruitful.
3. Pay yourself first. Even if the government comes knocking on your door, you deserve to be paid first. The best way to do this, in Kiyosaki’s opinion, is to hide under the umbrella of a corporation. The author fails to recognize the difference between business expenses and personal expenses. I’m sure at least some of his devoted readers will have taken the words to heart, used expense accounts to buy rolexes, and will have enjoyed the fist of the IRS lodged firmly up their arses ever since.
Early in the book, Robert explains how he and his best friend Mike became swept under the wing of Rich Dad, a fatherly figure hated by his employees but blessed with the secret of knowing how to generate immense wealth. What could it possibly be?
The boys, at this point, are only 9 years old. Rich Dad puts them to work every Saturday, paying a pathetic 30 cents for their time. One day Robert snaps and can’t take it any longer. “You said you’d teach me the secret of wealth! All you’re doing is forcing me to bust my guts for nothing!”
At this point, Rich Dad launches in to a mind-bending interpretation that he has actually done the boys a favour. He’s proven that the rat race is no way to spend a life.
Note: I’m pretty sure exploiting child labour in the manner of Rich Dad is considered illegal, even in America. Somehow, the madness only escalates.
What follows is a laughably contrived debate between alleged moneybags entrepreneur and inquisitive 9 year old Kiyosaki. I don’t remember how savvy I was at 9 years old, but I’d be amazed if I was able to remember even a fraction of the investment ‘wisdom’ that Rich Dad throws in the face of this kid. It’s clear that the encounter is entirely fictional and designed to portray a conversation between Rich Dad and the reader. But what does it say about the lessons to be learned that Kiyosaki has cast the audience as a hapless 9 year old child?
Just like that, Robert sets off on his adventure in search of riches and fame. Well, I suspect he achieved one before the other.
I could find only one bright spot in the entire book. It arrives out of the blue when Kiyosaki expresses the importance of investing in assets rather than liabilities. This is basic financial footing. Don’t spend more money than you bring home. Invest extra money in assets, and stay out of debt. I can see how the big reveal – Kiyosaki calls it the only rule of wealth that matters – might bring clarity and a sense of direction to those who have been doing it wrong. But for everybody else, it should be common sense.
Kiyosaki explains very little about where to invest money, nor what makes a good asset. But he does launch in to a tirade about the importance of paying yourself first. The argument can be summed up best with this stroke of genius:
“When I occasionally come up short. I still pay myself first. I let the creditors and even the government scream.”
Perhaps I’m missing something, but if this doesn’t tick the right boxes for ‘catastrophic financial tip of the year’, then I don’t know what will. More tellingly, it goes against every sound cashflow suggestion that he squeaks in to the first few chapters, removing any hint of a saving grace from the diatribe to follow.
How can you truly appreciate the importance of assets vs liabilities when you’re continuously battering your credit rating by refusing to stump up cash for your bills and debts?
Kiyosaki argues that it doesn’t matter. Paying yourself first is ideal, no matter how loudly the government screams, because even if you don’t have the money in your bank account, the over-commitment will inspire and motivate you in to making ends meet. It’ll force you to grow as a businessman. What?! No really, what the fuck? Does he have the slightest Scooby what he is ranting on about?
One could argue that attempting to blood financial wisdom from a Kiyosaki sales device is like watching a SmackDown divas’ pillow-fight in the hope of extreme pornography. Expectations need to be met by reality. Yet I was still left wondering how such a half-baked cocktail of metaphors and generalizations could ever be met with widespread acclaim. Then it tweaked. The Warrior Forum flashed before my eyes, and normality was restored. Common sense looks like genius when it’s viewed from a cesspit of stupidity.
Do yourself a favour. Don’t buy Rich Dad Poor Dad.
Recommended This Week:
A better read on the subject of wealth generation, although still somewhat flawed, is The Millionaire Fastlane, which I reviewed last month.
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This book is essentially mind set changer. It changes the perceptions on money, careers, life styles etc. People who have…